We examine the role of non-economic partnerships in promoting international economic exchange. Since far-sighted countries are more willing to join costly international partnerships such as environmental treaties, environmental engagement tends to encourage international lending. Countries with...

A stable international monetary system has emerged since the early 1990s. A large number of industrial and a growing number of developing countries now have domestic inflation targets administered by independent and transparent central banks. These countries place few restrictions on capital...

In order to study the costs/benefits of a monetary union between Germany and France, we attempt to go beyond a mere focus on asymmetries and examine what each country would have lost or gained had there been a common monetary policy. We try to identify the macroeconomic effects of such a change...

What are the prospects that risk sharing in EMU will ever attain the levels in the US? So far as the risk sharing in the US depends on interregional transfers through the budget of the federal government, those prospects are poor. So far as the risk sharing in the US takes place though market...

This paper employs worldwide data on output and bilateral trade in order to identify optimum currency areas (OCA’s) on a global basis. By retaining only two of the many criteria that have been mentioned in the literature on OCA’s, it has been possible to use computer programming to do the...

This paper seeks to integrate more closely the theory of optimum currency areas with the theory of international trade. The currency area is considered as a continuous variable ranging from zero to one: zero if there is no enlargement, and some positive value otherwise, corresponding exactly to...

In order to assess the costs of a European Monetary Union, we use a structural VAR approach based on the long-run identifying scheme pioneered by Blanchard and Quah and extended by others. We then apply the approach to as many EU members as data limitations permit: namely, Germany, Spain,...

In contrast to conventional analyses of monetary union between two particular countries or sets of countries, this paper treats the possible expansion of a given currency area as a continuous variable ranging from zero to one; zero if there is no expansion and one if all sources of imports and...

The effects of Regional Trade Agreements (RTAs) are disputed. In this paper, we assess these effects using capital market data and an event-study approach, using a daily data set covering a thousand announcements spanning over eighty economies and a hundred RTAs over twenty recent years. We...

This paper develops a procedure to rank-order countries and commodities using disaggregated US imports data. It finds strong evidence that both countries and commodities can be ranked, consistent with the ‘product cycle’ hypothesis. Countries habitually begin to export goods to the United...